Hong Kong Forges Ahead: Crafting Crypto Rules for OTC Venues and Stablecoin Issuers
Feb 3, 2024
Hong Kong has announced its intention to consult on a regulatory framework for over-the-counter (OTC) crypto venues in the near future, according to the Financial Services and the Treasury Bureau (FSTB). The consultation will encompass virtual-asset (VA) outlets, including physical shops and online platforms. The move comes as OTC venues have been linked to fraudulent activities involving unlicensed VA trading platforms, which prompted the need for regulation. Hong Kong has been actively working on regulating the virtual asset sector and introduced a licensing regime for crypto companies in June of the previous year. Companies operating in the country must secure approval by June of this year to continue their operations. Additionally, Hong Kong is also exploring a regulatory framework for stablecoin issuers, which would require fiat-backed stablecoin issuers to obtain a licence from the Hong Kong Monetary Authority.